US Markets

Dow surges more than 300 points on blockbuster jobs data, S&P 500 erases losses for the week

Experts look at markets after US economy adds 266,000 jobs

Stocks surged on Friday on the back of U.S. jobs growth that easily topped analyst expectations as Wall Street wrapped up a choppy week of trading.

The Dow Jones Industrial Average was up 337.27 points, or 1.2% at 28,015.06. Friday's performance was the Dow's best since Oct. 4, when it rallied 1.4%. The S&P 500 closed 0.9% higher at 3,145.91 — its biggest one-day gain since Oct. 15 — while the Nasdaq Composite jumped 1% to 8,656.53.

Shares of 3M led the Dow's strong gains, rising more than 4%. The energy sector was the best performer in the S&P 500, jumping 2%. Industrials and financials rose more than 1% each. Google-parent Alphabet closed 0.9% higher and hit an all-time high. Apple shares also reached record levels, gaining 1.9%. Goldman Sachs shares jumped 3.4%.

"The market is very strong," said Mike Katz, partner at Seven Points Capital. "Every time we pull back for a couple of days, we shake out some weak hands, we got right back up to all-time highs."

"Going into year-end, I think we're going to get a pretty good push higher," Katz added.

The S&P 500 came into the session down 0.7% for the week, but Friday's strong gains helped the index recover those losses. The Dow and Nasdaq each entered Friday trading down more than 1% week to date. They were only down 0.1% each for the week after Friday trading ended.

Stocks also closed just below their record highs reached Nov. 27. The S&P 500 was just 0.3% away from hitting an all-time high. The Dow and Nasdaq are both 0.6% off their records.

The U.S. economy added 266,000 jobs in November, according to figures released by the Labor Department. Economists polled by Dow Jones expected a gain of 187,000. The unemployment rate fell to 3.5%, matching its lowest level since 1969.

"After the sharp slowdown at the start of the year, the recent rebound in employment growth is clearly encouraging, and suggests that the loosening in financial conditions this year is starting to support the economy," said Andrew Hunter, senior U.S. economist at Capital Economics, in a note.

Treasury yields climbed to their session highs after the data was released, pushing prices down. The benchmark 10-year yield traded at 1.84% while the 2-year rate was at 1.62%.

Gold futures shed 1.2% to settle at $1,465.10 per ounce.

Stocks surge on jobs number, trade news

"There is a lot to like in today's read," said Mike Loewengart, vice president of investment strategy at E-Trade, about the jobs report. It also "puts a lot of questions to rest. It essentially means the Fed's easing cycle is complete and it puts the US in a stronger position for trade war negotiations."

Friday's report comes as investors grappled with mixed signals on the U.S.-China trade front this week. China started off the week saying it wants tariffs to be canceled as part of a "phase one" trade deal. President Donald Trump later said he could hold off on any deal until after the 2020 U.S. election.

That rhetoric sent stocks tumbling to start off the week. However, Trump said Thursday the two countries were inching closer to a trade deal. China also extended an olive branch to the U.S. on Friday by waving import tariffs on some American pork and soybeans shipments.

But Larry Kudlow, director of the National Economic Council, told CNBC's "Squawk on the Street" that Trump is prepared to "walk away" from the negotiations if some conditions are not met. "The president has said that if we can not get the enforcement and the assurances, then we will not go forward," Kudlow said.

Both sides have less than 10 days to go before Washington is poised to impose even more tariffs on Chinese goods. Tariffs on another $156 billion in Chinese goods are set to go into effect on Dec. 15.

—CNBC's Yun Li and Sam Meredith contributed to this report.